Stage 2 examples - the A+ stocks
I came across three charts in my daily scans today that I thought would make good examples for people learning the Stage Analysis method.
We show a lot of charts on here every day in various stages in the watchlist threads and the daily breakouts and breakdowns threads, but we rarely see those A+ Stage 2 advances that the book talks about finding. So here are some examples of what Stan was talking about in the book when he mentioned looking for the A+ picks, and considering the opportunity costs of trading average breakouts instead of working to find these big winners.
As you can see from the charts they all had very strong Stage 2 runs over the last year and are now in different Stages with UNXL now in Stage 4, and TSLA and LCI both in Stage 2B, but both still with strongly rising 30 week MAs.
The volume profile wasn't necessarily perfect on the Stage 2A breakout week, so they wouldn't have been considered A+ picks straight away, but as you can see all three had strong volume come in as they broke out to new highs, and it continued to build, as well as mostly strongly outperforming the market following the breakouts and staying well above their Mansfield zero lines.
So I think it's good to realise that the A+ picks might not be in instantly recognisable from an A or a B grade pick, but once that volume starts coming in as it continues to make new highs, you'll know to hold onto them through the Stage 2 advance and follow the trailing stop loss method as suggested in the book.
Fate does not always let you fix the tuition fee. She delivers the educational wallop and presents her own bill - Reminiscences of a Stock Operator.